India’s domestic gold consumption and manufacturing are set to receive a significant boost following the announcement by Finance Minister Nirmala Sitharaman to slash customs duties on gold, silver, and other precious metals in the recent budget speech.
The reduction in customs duties on these precious metals aims to enhance domestic value addition in the country’s gold and precious metal jewellery sector. The budget has seen a cut in customs duty on gold bars, gold dore, silver bars, and silver dore, reducing the rates from 15% to 6%. Similarly, the customs duty on platinum, palladium, and other precious metals has also been significantly reduced, making it more affordable for businesses in the industry.
This move comes at a crucial time as the country has witnessed a surge in smuggled gold seizures in recent months. By reducing the taxes on gold, the government hopes to make the local industry more competitive and curb illegal activities like smuggling.
Industry experts have welcomed the decision, stating that it will not only boost domestic demand for gold and silver but also increase the competitiveness of the Indian jewellery market. The reduced taxes are expected to lower gold prices locally, making it more accessible for consumers and driving up demand in the domestic market.
Overall, the reduction in customs duties on precious metals is seen as a positive step towards promoting the growth of the Indian jewellery industry and creating a level playing field for industry stakeholders. It is expected to stimulate manufacturing, increase exports, and foster a more robust and sustainable industry in the long run.
